HOW TO MAKE VEHICLE TRANSFER EASIER WHEN SOMEONE DIES

HOW TO MAKE VEHICLE TRANSFER EASIER WHEN SOMEONE DIES

By Kim K. Steffan, Attorney

 

            If you are married or in a long-term relationship, consider having all your vehicles titled as “joint with right of survivorship.”  When one partner dies, the other partner will own 100% of the vehicle.  The survivor can transfer the title the easiest way – by bringing the title and death certificate to the DMV office.  No Clerk of Court or estate paperwork is necessary at all.  This saves time, money, and trouble.

            Titling a vehicle this way requires taking particular steps.  The initials “JWROS,” which stand for “joint with right of survivorship” must appear after both owners’ names on the title.  It looks like this:  “John Smith and Mary Smith, JWROS.” Just having both names (like “John Smith and Mary Smith”) without the initials “JWROS” will not give you the benefit of survivorship.  If it’s titled in both names without “JWROS,” half the value of the vehicle will be in the estate of either partner when he/she dies; it does not mean that the survivor will own 100% of the vehicle.

            Because titling vehicles JWROS is not well known, many DMV title clerks and car dealers’ staff are not familiar with it, and don’t think it can be done.  It can. NC law allows it.  I keep at my office to share with clients the section of the DMV Title Manual that permits it.  If you would like a copy at no charge, please contact my office.  It helps to take this with you to the car dealer when you purchase your vehicle or when you visit DMV to get your new title.  (The DMV Title Manual is a handy reference for a lot of things.  It tells you how DMV handles many transactions, what paperwork you need, what fees are charged, etc.  To find it, go to: https://connect.ncdot.gov/business/dmv/dmv%20documents/nc%20title%20manual.pdf.)

            Some clients who aren’t married or with a long-term partner ask me if they should title a vehicle JWROS with their adult child to transfer title automatically after they pass.  I usually discourage that, because it means giving a half interest in your car to your child.  If you decide to sell your car, both your child and you would have to sign.  Your child (as well as you) would have liability as an owner in the event of a wreck.  If your child has unpaid creditors who get a judgment against him or her, the creditor could force the sale of your car. 

            Sometimes a person dies owning a vehicle, and that is the only asset in his estate.  In that case, there is a shortcut so you do not have to probate the estate to free up that asset.  You can take the death certificate, will, and car title to Clerk’s Estates Office. You’ll fill out DMV Form 317 Assignment of Title, which the Clerk will certify for a nominal fee; then, take it to DMV to transfer the title.  If there’s no will, or if the person getting the vehicle by agreement is someone other than whom the will says, all family members must sign the Form. 

            Finally, if a vehicle is titled in the name of a deceased spouse (or is jointly owned but without JWROS), a surviving spouse can list the vehicle on a Years’ Allowance form with the Clerk. Take this form and the title to DMV to transfer the title to the spouse. The Clerk’s fee is nominal.  This option is only available to spouses.

            These are some ways to make it easier to transfer a vehicle title after someone dies without probating a full estate. Which one works best for you depends on your circumstances.

 

 

YOU’VE BEEN NAMED EXECUTOR – WHAT’S NEXT

YOU’VE BEEN NAMED EXECUTOR – WHAT’S NEXT

            Someone important in your life has passed away.  The Will names you as the Executor of  the estate.  What happens next?  How can you make things go smoothly?

  1. Identify and take control of estate assets:  Some of your most important duties are determining what estate assets are, and safeguarding them until the right time to use them to pay creditors or to disburse to heirs.  If you as an Executor let go of estate assets too early, and it turns out they are needed to pay claims or they are supposed to go to another heir, you are financially responsible.
  2. Where to get basic information:  The Clerk of Court has an excellent booklet available describing the probate process.  You are not required to have a lawyer.  However, some estates are complicated enough that you’ll need a lawyer.  Some Executors choose to have an attorney even if they could handle the estate themselves, to make the process easier.  Lawyers know what forms need to be filed, when, and where.  They sometimes know easier ways to get things done.
  3. Decide what kind of probate estate is needed:  Many people know the gist of a “regular” estate, which takes at least 4-5 months to complete, requires running a newspaper creditor notice, and includes various forms filed with the Clerk.  Sometimes there are shortcut alternatives.  For example, when the surviving spouse is the only beneficiary, and that spouse does not mind taking on the estate’s debts, Summary Administration may allow opening and closing the estate on the same day.  In estates with personal property valued at less than $20,000 to $50,000 (depending on the family composition), a “small estate” process (technically called Affidavit of Collection) may save time and money.
  4. Get qualified:  Opening the estate file with the Clerk gets you the papers showing you are officially the Executor, called Letters Testamentary.  You’ll use these Letters to accomplish estate business, including opening an estate bank account to keep finances straight. 
  5. Valuing assets:   The Executor must list values for all assets.  Many times tax value will suffice.  However, remember that for real estate, higher values are usually better because you’ll want to maximize stepped-up basis (meaning a savings on capital gains taxes if the property is sold later).  It may be worth getting an appraisal to justify a higher value on real estate.  In general, lower values are better on personal property, like vehicles and furnishings, to save money on court filing fees.
  6. Let the creditor period run:  The Executor may be required to publish a newspaper notice to creditors, or may choose to publish one if not required.  The value of the notice is that it gives a 90 day period for estate creditors to file claims (except those the Executor already recognizes as valid).  That means unknown creditors cannot “come out of the woodwork” later and claim they are owed money. 
  7. Finishing the estate: After the creditor period passes, the Executor can determine what money is needed to pay creditor claims, and can pay them.  If necessary, assets like vehicles, furniture and land can be sold to generate money to pay creditors.  There may be tax returns or other tax forms to be done; an accountant can help with these.  The Clerk can approve payment of a commission to the Executor for his work.  The estate can also reimburse the Executor for his expenses.  Once creditors and estate administration expenses are paid, the Executor will distribute the remaining assets to the beneficiaries in the manner the Will requires.  A Final Account is filed with the Clerk, which officially closes the estate.

              Sometimes people are comfortable handling a simple estate without an attorney.  What can an attorney help you with?  By consulting an attorney early on,  you  can    determine whether probate is necessary at all and, if so, what is the simplest, fastest, least expensive way to accomplish this.  Knowing this early on can save unnecessary expense.  Once you know an estate is needed, the attorney knows what needs to be filed and done, along with when and where to get these things taken care of.  This makes it easier and less time consuming to handle the estate on time and to know it is done right.  Some types of estates particularly benefit from help from an attorney, including those with real estate, those with many different assets, those with beneficiaries or heirs in conflict, and estates with a lot of debts.  Some attorneys offer an initial consultation with new clients at no charge or at a small fee.  Steffan & Associates, P.C. offers such a consultation a no charge, so that you can find out whether you need an attorney and what your matter will cost without worrying about the “meter running.”

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